Question: Why is the least-squares regression method preferred to the highlow method when analyzing mixed costs?

Why is the least-squares regression method preferred to the high–low method when analyzing mixed costs?

Step by Step Solution

★★★★★

3.40 Rating (163 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

The leastsquares regression method compared to the highlow ... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Managerial Accounting Questions!

Q:

On December 1, 2019, Lynch Incorporated sold $18,000 of merchandise with terms 2/10, n/EOM. On December 11, 2019, collections were made on sales originally billed for $12,000, and on December 31,...

Q:

Waterwise Plumbing Supplies is a wholesaler for a large variety of plumbing supplies. The company's accountant, Bob Washer, has recently completed a cost study of the firm's Shipping Department in...

Q:

Refer to the data for Archer Company in Exercise 56. Required: 1. Using the least-squares regression method, estimate a cost formula for shipping expense. 2. If you also completed Exercise 56,...

Q:

Refer to the data for Zerbel Company in Exercise 5-7. Required: 1. Using the least-squares regression method, estimate the cost formula for shipping expense. 2. If you also completed Exercise 5-7,...

Q:

question: 6-7, 6-9, 6-18, 6-19 c. Total fixed costs? d. Total variable costs? 6-3 Define the following terms: (a) cost behaviour and (b) relevant range. 6-4 What is meant by an activity base when...

Q:

i need a conclustion about this REQUIRED QUESTION ONE = Sale or Actual Results Cost Function Variance Line Item Units sold Sales Revised Budget 135,000 $1,350,000 0 135.000 $1,350,000 y=S1OX SO...

Q:

show all work plz Use the information below to answer the following two questions: Chamomile Inc. is a manufacturing company whose total manufacturing overhead costs fluctuate somewhat from month to...

Q:

Section 1 True or False Indicate TRUE or FALSE after the statement. (20 marks) 1. Modern technology is causing shifts away from variable costs toward more fixed costs in many industries. 2. In order...

Q:

1 True or False Indicate TRUE or FALSE after the statement. (20 marks) 1. Modern technology is causing shifts away from variable costs toward more fixed costs in many industries. 2. In order for a...

Q:

Section 2 Multiple Choice (60 marks) Please yellow-highlight the entire line of the correct answer. 1. Expense A is a fixed cost; expense B is a variable cost. During the current year, the activity...

Q:

Part 1: Part 2: Part 3: Required information George Caloz \& Frres, located in Grenchen, Switzerland, makes luxury custom watches in small lots. One of the company's products, a platinum diving...

Q:

On January 1, Morris Company offered a customer a 10% trade discount if the customer purchases 1,000 units of an item within the next 6 months. Each item sells for $ 100. Based on the customers...

Q:

Recovering and reusing organic solvents (rather than discharging the solvents in waste streams) is an important part of the operation of most chemical plants. The magnitude of these recovery efforts...

Q:

Study the tax system for the three countries below. Calculate the percentage of tax paid on each level of income and identify whether the tax systems are progressive, regressive or proportional. Tax...

Q:

4. Real GDP per capita is an imperfect measure of the quality of life in part because it a. includes the value of leisure time. b. excludes expenditures on education. c. includes expenditures on...

Q:

Brown Corp.s weekly production output is 800 units of a product that sells for $20 per unit and has variable costs of $16 per unit. Maximum capacity is 1,000 units per month. Total fixed costs per...

Q:

Imperial Jewellers is considering a special order for 20 handcrafted gold bracelets for a major upscale wedding. The gold bracelets are to be given as gifts to members of the wedding party. The...

Q:

TBI Ltd. makes tennis balls and other tennis-related items. This year?s expected production of tennis balls is 10,000 tins (each consisting of three tennis balls). Cost data are as follows: The full...

Q:

Ritz Company sells fine collectible statues and has implemented activity-based costing. Costs in the shipping department have been divided into three cost pools. The first cost pool contains costs...

Q:

1 . You want to purchase a house: your maximum monthly payment is $ 2 , 8 0 0 , and you also have a saving of $ 1 2 5 , 0 0 0 as the down payment. You apply for a 3 0 - year fixed mortgage loan with...

Q:

IVIL.V0.134 Question 22 of 60 Company A has a beta of 0.70, while Company B's beta is 1.40. The required return on the stock market is 9.00%, and the risk-free rate is 2.25%. What is the difference...